Germany and France keep the onus on Greece

I am City A.M's deputy editor, having joined the newsroom in late 2010 as an economics reporter.

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Julian Harris

FRENCH President Francois Hollande stuck by German chancellor Angela Merkel last night, as the pair preceded crunch Eurozone talks by insisting that Greece must maintain its programme of fiscal consolidation.

The meeting came at the end of a day in which new economic data pointed to recession and tumbling consumer confidence in the single currency area.

“We want – I want – Greece to be in the Eurozone … it’s up to the Greeks to make the effort that is essential for that goal to be met,” Hollande said.

His statement echoed comments made the previous day by Merkel and Eurogroup chief Jean-Claude Juncker, as Eurozone leaders turn the screw on Greece.

“We and I will encourage Greece to pursue the path of reform that demands a lot from the people,” added Merkel last night, in a conference held prior to dinner-time talks with Hollande. Greece has been asking for more time to implement austerity measures that are conditional on it receiving further tranches of bailout funds from its international lenders.

But many lender governments are opposed to loosening the conditions, with Dutch finance minister Jan Kees de Jager leading the disapproval.

“I say to the German government that it is best for it to stick with its strict position,” he added yesterday. “Delaying correct measures helps nobody, not even the Greeks.”

Hollande also repeated his call for a euro-wide banking union.

Meanwhile a purchasing managers’ index (PMI) suggested that the Eurozone economy will shrink by 0.5-0.6 per cent this quarter, while an EU consumer confidence survey also worsened more than expected in August.